See How Tanzanian Fahad Awadh Beat All Obstacles To Build A Profitable Business

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Fahad AwadhWhat do you do when people don’t believe in your idea? Do you give up on it or do you let your belief block out the disbelief around you? Fahad Awadh is a prime example of blocking out the disbelief that surrounds you to make your ideas reality.

Fahad Awadh is a 31-year old entrepreneur from Tanzania. He recently moved back home from Canada to set up a cashew processing facility in an effort to bring international standards and traceability to the cashew nuts.

He founded YYTZ Agro-Processing, a cashew processing company that is not only solving Tanzania’s cashew nuts processing problems but also adding value locally as he creates jobs and boosts the income of farmers and the community as a whole.

The company’s flagship processing facility in Zanzibar has an installed capacity of 2,500 Tons per annum.

Tanzania produces about 200,000 tons of cashews a year and its cashew is considered one of the best quality in the world.

However, the country lacks processing facilities and capacity building needed to grow. Fahad took it upon himself to create local processing for this valuable commodity and growing it back into what it used to be, an important foreign exchange earner for the country.

Entrepreneurial Background and Education

Fahad started off his education in St. Christopher’s, a private British school in Bahrain, where he lived with his family for 8 years. His family moved to Canada later on when he was 10.

While in Canada, Fahad was accepted into an International Business and Technology program at the age of 11. It was a foundational experience that instilled and nurtured in him an entrepreneurial spirit.

At such a young age, Fahad had started learning about Accounting, Business Marketing, and Entrepreneurial. By the age of 12, he had created a business with a product and was selling at the District School Board.

Fahad went on to study Business Marketing at York University. His entrepreneurial spirit was stirred and he started making t-shirts with two friends, Lavado Stubbs and Momarr Taal (recently named in Forbes Africa 30 under 30) while in university.

The brand was called Malyka Clothing, which means Angel in Swahili and it focused on putting positive and powerful messages on shirts.

In no time, the brand became popular in Toronto and they began distributing in Canada, The Bahamas, and the Gambia.

Fahad traveled to Bangladesh and secured a manufacturing contract to produce the brand’s pieces from the cut & sew stage, thereby giving them more creative control over the product and allowing the brand’s line expand.

fahad awadhReturning to Tanzania

After living in Canada for most of his formative years, Fahad returned to Tanzania. The goal was to invest as he always had the dream to come home and set up a business.

In late 2012, Fahad visited Tanzania and decided to explore opportunities in processing and value-addition.

Realising how rich the resources of Tanzania are as well as the lack of facilities making the best of the resources, Fahad saw an opportunity in local value addition.

He spent a lot of time traveling around rural Tanzania, meeting with farmers and understanding the cashew sector, practicing a principle he learned from The Toyota Motor Corporation called genchi genbutsu: going to the source and seeing things for yourself.

Fahad was able to make informed business decisions and conduct thorough and extensive research into the cashew nut industry. He concluded there was a real need for processing and value addition.

After deciding to invest, he partnered with his father, who was retiring after a career as a commercial pilot.

After developing a thorough business plan, they decided it would be best to invest in a modern processing plant that would utilize automated equipment to make their operation more efficient and give them economies of scale.

It is important to note the extent of research Fahad went through before making decisions about this business. He went as far as traveling to Vietnam, which is the largest cashew exporter in the world.

He visited one of the top-five largest factories and studied their operations, learning best practices. The Vietnamese have been able to achieve tremendous growth by advancing the mechanization of cashew processing and so

He didn’t stop there, he also went ahead to purchase the business’ cashew-specific equipment from reputable Vietnamese manufacturers.

Fahad also needed to ensure that he found an export market for their project to secure its commercial viability. He began researching and cold-emailing companies in Europe and North America. His goal was to stir interest in a buyer to help them later when they needed to access financing and he was able to secure a buyer in the Netherlands.

Funding Issues

It was still difficult to get funding in the beginning, despite the buyer from the Netherlands, due to the capital-intensive nature of the business.

Fahad battled to raise the required funds to set up his business. He recalls,

“I went to banks and presented my business plan with all the research I had done to them.

When I first went to them, I didn’t have a customer yet. I knew that if I was to access this funding, I would need to prove to them that there was a market so I went online and started looking for the importers.

I just emailed and called companies, told them what we were doing and stated that we would like to supply them cashews. The idea was just to gain their interest, and to put that interest in writing so that I could prove to the banks that I had reputable customers that they could research on.

The first thing the banks would say is that they do not finance new businesses, not regarding that you have collateral. With my collateral, and customers ready, many banks refused to finance the business just because it was new.”

Fahad also tried a government development bank, which is supposed to fund agriculture and agro-processing projects.

“I went to them and began funding discussions with a letter of intent from a customer. But time kept going and I could see that they were not interested in funding. The general response I got was that it wasn’t possible, people have tried and it did not work. They never asked how I was going to do it. They were not asking the right questions, they were always asking of the negative side, asking what if it fails.

I told them, if you are going to fund this, let me know and if you are not going to, let me know too. I am still going to do this project, it will happen and it will work. I just need to know if you are going to support or not so I can move on and find another means of funding.”

Breakthroughs

Fahad was not deterred. He kept pushing and ended up sourcing funds to purchase equipment on his own.

He then purchased the equipment and set up the facilities in the export processing zone in Zanzibar, close to the port. It got easier because the banks could now see a facility and some equipment for processing.

Fahad’s company, YYTZ Agro, went ahead and entered a competition, The Africa Enterprise Challenge Fund, which they won.

From this competition, they received a $500,000 and it gave them a boost. Not only is this money helping them build another facility close to the farmers that put them in the value chain, it also accorded YYTZ some credibility and changed the attitude of the local banks.

Fahad noted,

“It is very ironic and sad that the banks that were not there when all I had was a vision are now calling, wanting to be part of the same business, same idea, same person they had rejected. This a perfect example of a challenge that we have as young entrepreneurs in Africa because this is not exclusive to Tanzania,”

Fahad’s team has been working with cashew farmer groups in the Mtwara region of Tanzania. To help them add value to their own crop and earn more income and plans to use these funds to build a Cashew Farmer Processing Centre.

Fahad is not only working to empower these farmers financially but make well-rounded farmers out of them.

He provides financial literacy and business skills training for them, as well as food safety training.

His team also make sure that the farmers have bank accounts for transactions in other to build up a credit history. This will enable them get small loans to grow their business.

Lessons from Fahad Awadh as an Entrepreneur

Fahad did not just become the entrepreneur that he is today without putting in work and cultivating discipline.

He is an avid reader and he enjoys reading business books that profile successful entrepreneurs and businesses.

He has taken many lessons from ‘Good to Great’ by Jim Collins, one of the most important being getting the right people.

It’s very important to have a great team and recruit talented individuals in your organization. He has also applied many principles of lean manufacturing and continuous improvement that he has learned from Toyota Motor Corporation.

Fahad also seeks advice and mentorship from successful entrepreneurs. He is always learning from their experiences and internalizing the lessons to apply them in his own business.

He has an advisory board that includes experts with years of experience in the cashew sector whose insights are invaluable.

Fahad says in his Forbes interview, I have had my share of challenges, and without them, he wouldn’t be where he is today.

I am a firm believer in God, none of this would have been possible without him.

And I have become a student of ancient Stoic philosophy, which teaches that within every challenge there is an opportunity.

In practice, I have learned to acknowledge there will always be challenges and setbacks. I have now prepared myself to learn from them and use them to my advantage. A great book about Stoic philosophy is ‘The Obstacle is the Way,’ by Ryan Holiday.

By having the right mentality when facing seemingly insurmountable obstacles, you remain objective and see the good in a situation.

It’s a philosophy that has been practiced by many great leaders, including John D. Rockefeller, Steve Jobs, James Stockdale and Marcus Aurelius.

As Marcus Aurelius put it nearly 2000 years ago,

“The impediment to action advances action. What stands in the way becomes the way.”

Fahad also practices gratitude and mindfulness daily. He meditates every morning, and always take time to reflect and align his focus with his goals.

When Fahad Awadh started YYTZ Agro in 2014, he had the vision of disrupting the cashew export industry in Tanzania.

Not only has he done this, Fahad has created a business that is improving the lives of so many.

In 2017, he was named one of Forbes’ 30 most promising young entrepreneurs in Africa, an honor very well deserved.

Fahad’s business is the definition of using one stone to kill multiple birds. Fahad Awadh is resuscitating the cashew industry in Tanzania and ensuring that the farmers have their lives changed for better.

He plans to take his business beyond Tanzania, to the rest Africa in other to impact as many as possible.

© 2018, Ona Akinde. All rights reserved.

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